Nonfarm payrolls rose 209,000 (1.5% y/y) during July. A 181,000
increase had been expected in the Action Economics Forecast Survey. The rise
followed gains of 231,000 in June and 145,000 in May. Together these figures
were revised up by 2,000. Hiring activity was mixed amongst sectors. Average
hourly earnings rose an expected 0.3% (2.5% y/y) following 0.2% gains during the
prior two months. The unemployment rate eased to 4.3%, as expected, and reversed
June's uptick. The overall unemployment rate, including marginally attached
workers and those working part-time for economic reasons, held steady at 8.6%.

From the payroll employment survey, private sector
payrolls increased 205,000 (1.7% y/y), the strongest increase since February.
Factory sector hiring rose 16,000 (0.5% y/y), also a five month high.
Construction sector jobs gained a diminished 6,000 (2.8% y/y). Double-digit
increases per month were common late last year through February. Mining sector
employment rose 1,200 (8.4% y/y), the weakest increase since the number of jobs
began to rise in November.

Private service sector employment increased 183,000 (1.7%
y/y), the strongest increase since last September. Leisure & hospitality
employment strengthened 62,000 (2.1% y/y), the strongest increase since
September 2015 and up from a monthly increase of just 5,000 in December.
Education & health care sector jobs increased 54,000 (2.3% y/y). They were
driven by a 45,000 increase (2.1% y/y) in health care, the strongest gain in a
year. Professional & business service sector jobs improved a fairly steady
49,000 (2.9% y/y). The 14,700 increase (4.3% y/y) in the number of temporary
help jobs also was in line with this year's gains. Trade, transportation &
utilities jobs grew a modest 7,000 (0.5% y/y), including a 900 uptick (-0.1%
y/y) in retail hiring. Financial activities employment improved 6,000 (1.8% y/y)
while information sector jobs increased 4,000 (-1.7% y/y).

Government sector jobs rose just 4,000 (0.5% y/y) after a
37,000 jump. Local government employment increased 7,000 (0.7% y/y) but the
number of federal government jobs remained unchanged (0.3% y/y). State
government employment eased 3,000 (+0.1% y/y).

The length of the average workweek held steady at 34.5 hours,
but that was up from 34.3 hours early this year. Individuals in the financial
sector worked a slightly lessened 37.5 hours. In the information sector,
individuals worked a stable 36.3 hours, up from last year's low of 35.8 hours.
Education & health services hours also were stable m/m at 32.9, but up from
the low of 32.6 in mid-2014. Leisure & hospitality hours-worked held steady at 26.1.

From the household employment survey, the dip in the
unemployment rate to 4.3% brought it to the lowest level since May 2001.
Employment grew 345,000 (1.3% y/y) while the labor force increased 349,000 (0.8%
y/y). The labor force participation rate rose to 62.9%, its highest level in
three months. That was down, however, from 66.2% in 2006. The size of the
population grew 0.6% y/y. The number of individuals not in the labor force grew
0.4% y/y, down from 0.7% growth during all of last year and the roughly 2% to 3%
growth rates from 2009 to 2015.

The average duration of unemployment rose slightly m/m to
24.9 weeks. It was down, however, from 28.0 weeks one year earlier and from 39.4
weeks during all of 2011. The number of long-term unemployed, 27 weeks or more,
declined 11.5% y/y.

By educational attainment, individuals with less than a high
school diploma realized a slightly higher 6.9% jobless rate as employment fell
1.2% y/y. Those with a high school diploma saw 4.5% joblessness as employment
improved 0.7% y/y. Unemployment for individuals with less than a bachelors
degree was 3.7% as employment eased 0.5% y/y. Unemployment of just 2.4% was
realized for those with a bachelors degree as employment jumped 3.2% y/y.